Dine Brands Misses Expectations

Takeout, delivery apps seen as key growth areas

The owners of chain diners International House of Pancakes and AppleBee’s International Inc., Glendale-based Dine Brands Global Inc., is incorporating new technology into its operations to make ordering fast and easy as the company looks to delivery and takeout for growth.

“Technology is a major focus,” Dine Chief Executive Steve Joyce told analysts on a May 1 investor call. “It is a key component to remove friction from our guests and enhance guest engagement.”

The company reported first quarter earnings of $1.90 per share on revenue of $237 million, below Wall Street expectations.

Dine is furnishing restaurants with wireless internet and outfitting tables with payment devices. The company is also adding technologies meant to reduce wait times at restaurants and alert staff when takeout customers arrive.

Company executives said they see online ordering, takeout and delivery as key opportunities. Dine is using its own online ordering services and third-party applications to draw in more consumers.

“We believe this segment of the business has additional growth potential as we optimize our delivery platform and expand into catering,” Joyce said.

Applebee’s President John Cywinski said the chain plans to expand third-party delivery to as many as 1,500 of its locations, up from 1,200 currently. Takeout and delivery orders accounted for about 13% of Applebee’s sales in the first quarter, but Cywinski estimated it could reach more than 20% in two to three years.

At sister chain IHOP, President Darren Rebelez said takeout and delivery sales accounted for 9% of sales in the first quarter, up from 5% during the same time last year.

“We believe to-go can increase to the low teens as a percentage of total sales over the next few years,” Rebelez told investors.